NtPasswordHash(
IN 0-to-256-unicode-char Password,
OUT 16-octet PasswordHash )
{
/*
* Use the MD4 algorithm [5] to irreversibly hash Password
* into PasswordHash. Only the password is hashed without
* including any terminating 0.
*/
}

It should say:

NtPasswordHash(
IN 0-to-256-unicode-char Password,
OUT 16-octet PasswordHash )
{
/*
* Use the MD4 algorithm [5] to irreversibly hash Password
* encoded in UTF-16-LE into PasswordHash.
* Only the password is hashed without
* including any terminating 0.
*/
}

Notes:

Section 8.3 is silent on Unicode encoding used for passwords.
Section 9.2 seem to imply that the Unicode encoding used in UTF-16-LE.